Mrs. Ramaben Bhagubhai Patel v. The Hindustan Electric Company Limited

Chandrachud, J.:— A question of some importance arises in this revisional application. The question is whether a decree passed in a summary suit, on the failure of the defendant to comply with the terms of conditional leave, can be set aside by the Court which passed the decree, on the ground that the defendant had sufficient reasons for not complying with the terms of the conditional order.

2. A suit was filed by the petitioner against the respondents to recover a sum of Rs. 10,000 on a deposit receipt alleged to have been executed by the respondents. On July 20, 1960, a summons for judgment was taken out in the suit, in reply to which the respondents put in their affidavit on October 16, 1960. On March 10, 1961, the summons for judgment was heard when the respondents were given conditional leave to defend the suit, the condition being that they should deposit a sum of Rs. 7,500 within a period of four weeks.

3. The respondents did not comply with the condition whereupon the suit was set down for hearing and on April 13, 1961, a decree was passed in favour of the petitioner. On June 12, 1961, a notice of motion was taken out by the respondents for setting aside the decree on the ground that they could not deposit the amount on account of financial difficulties. The notice of motion has been made absolute by the learned Judge of the City Civil Court, Bombay. The learned Judge has held that a decree which is passed under O. XXXVII, r. 2(2), of the Civil Procedure Code cannot be set aside either under O. IX, r. 13, the decree not being an ex parte decree, nor under O. XXXVII, r. 4, that provision, according to the learned Judge, being applicable to cases in which the defendant has not appeared at all in answer to the summons for judgment. The learned Judge has, however, taken the view that by reason of the absence of a specific provision in the Code of Civil Procedure which will govern the case, a decree passed under O. XXXVII, r. 2(2) can be set aside under the inherent powers of the Court under s. 151 of the Code. So holding, the learned Judge has set aside the decree and has directed that the suit should be restored to the file on condition that the defendants deposited the entire decretal amount in the Court as also the costs incurred by the plaintiff in the suit and in the notice of motion.

4. The question which arises in these circumstances is whether the learned Judge has jurisdiction to set aside the decree which was earlier passed for failure of the defendants to comply with the terms of the order of conditional leave. It is important to mention that this is not a case in which the defendants have failed to appear in answer to the summons for judgment. The summons for judgment was duly served on the defendants, who appeared in answer to the same and contended that unconditional leave to defend the suit should be granted to them. After hearing the parties, an order was passed by Judge Vimadalal that conditional leave be granted to the defendants on their depositing a sum of Rs. 7,500 within four weeks from the date of the order. The first question which arises is whether there is any specific provision in the Civil Procedure Code which applies to cases of the present kind. The only provisions on which reliance was placed on behalf of the defendants are those contained in O. IX, r. 13 and O. XXXVII, r. 4, of the Civil Procedure Code. The learned Judge has held that neither of these two provisions can have any application. Mr. Daji, who appears on behalf of the defendants, concedes that O. IX, r. 13 cannot possibly apply to the case of the present kind. The concession is rightly made, because a decree which is passed in a summary suit, on default of the defendant to comply with the terms of the order of conditional leave, cannot strictly be described as an ex parte decree. Mr. Daji, however, contends that the learned Judge was in error in holding that O. XXXVII, r. 4, does not cover a case of the present nature. O. XXXVII, r. 4 provides that after a decree is passed under O. XXXVII, r. 2(2),

“the Court may, under special circumstances, set aside the decree and if necessary stay or set aside execution and may give leave to the defendant to appear to the summons and to defend the suit, if it seems reasonable to the Court so to do and on such terms as the Court thinks fit.”

5. According to Mr. Daji, the language of O. XXXVII, r. 4 is reasonably capable of the construction that what is intended by the Legislature is that the Court which passes a decree, in default of the defendant to comply with the conditions on which he was permitted to defend the suit, must have jurisdiction to set aside that decree if the Court is satisfied that there are special reasons or special circumstances which make it necessary to set aside the decree. I find it difficult to accept the argument of the learned counsel because, in the first place, to accept the construction canvassed by the learned counsel is to frustrate the very object for which provision has been made in O. XXXVII for the trial of summary suits. Secondly, what is specifically provided in O. XXXVII, r. 4, is that after the decree is passed, the Court may set aside the decree and “may give leave to the defendant to appear to the summons… This clause clearly shows that the power conferred by r. 4 of O. XXXVII can be exercised only in cases in which the defendant has initially failed to appear in answer to summons for judgment. What follows this clause is also important because what is mentioned thereafter is that the Court, after setting aside the decree in view of special circumstances, may give leave to the defendant to defend the suit on such terms as the Court thinks fit. In other words, the Court has been given the power not only to permit the defendant to appear in answer to the summons but the Court has also been given the power to fix the terms on which the defendant, at whose instance the proceedings are re-opened, should be permitted to defend the suit. If the construction which Mr. Daji wants me to place on r. 4 of O. XXXVII were to be accepted, then a somewhat startling consequence will ensue and the consequence is that the defendant who fails to comply with a conditional order will be in a more favourable position than the defendant who complies with a conditional order. Take a case in which an order of conditional leave is passed and the defendant complies with the condition. If the defendant were to make a grievance of the condition on the ground that the condition was harsh or oppressive no interference would normally be made in the exercise of revisional jurisdiction with the discretion of the trial Court. If, on the other hand, the defendant were to fail to comply with the order passed by the trial Court, then, according to Mr. Daji, it would be open to the Court not only to set aside the decree which followed the refusal of the defendant to comply with the order of conditional leave, but it would also be open to the defendant to have the matter reopened and to ask the Court to pass a fresh order of leave to defend the suit, regardless of what order was passed on the earlier occasion. Such a consequence, involving a double opportunity to a defaulting defendant, could not have been intended by the Legislature. In my opinion, the limited object of O. XXXVII, r. 4 is to empower Courts to set aside decrees passed in cases in which the defendant has failed to appear in answer to the summons for judgment, if it appears to the Court that there are special circumstances by reason of which the defendant could not appear in answer to the summons. In other words, what is provided by O. XXXVII, r. 4 is that the position which obtained at the institution of the summary suit should revive, an advantage of which the defendant could not avail himself should be made available to him because he had good reasons for not appearing in answer to the summons for judgment and that the defendant should be given leave to defend the suit on such conditions as the Court deems fit. For these reasons, I am of the opinion that the learned trial Judge was right in holding that the provisions of O. XXXVII, r. 4 cannot apply to a case in which a decree has been passed under O. XXXVII, r. 2(2) for failure of the defendant to comply with the terms of the conditional order.

6. The nest question which arises is whether the learned Judge was justified in invoking his jurisdiction under s. 151 of the Civil Procedure Code. It is well-settled that s. 151 does not confer any new powers on the Courts. What that section does is to maintain intact such powers as are possessed by the Courts and to provide that those powers can be exercised in the interests of justice or to prevent abuse of the process of the Court. It is equally well-settled that if there is any specific provision in the Civil Procedure Code which governs a case then the powers conferred by s. 151 should not be resorted to. Lastly, it must be borne in mind that the powers conferred by s. 151 must be exercised with circumspection and sparingly as they are not intended to be exercised as a matter of ordinary routine. The learned Judge has held that there is no provision in the Civil Procedure Code which governs the case of the present kind and that, therefore, the powers under s. 151 can be invoked. The question which arose before the learned Judge was whether a decree in a summary suit, which was passed by reason of the default of the defendant to carry out the conditions which were imposed upon him could be set aside under s. 151. Before a Court could act under s. 151 of the Civil Procedure Code, it is at least necessary that the Court must be possessed of the matter and must have jurisdiction to pass orders in the ease. It is indisputable that except in cases in which the jurisdiction of the Court is expressly preserved in that behalf, the Court which tries a suit loses all jurisdiction over it with the passing of a decree. That the decree is passed under O. XXXVII, r. 2(2) should, in principle, make no difference to that position. A decree may come to be passed under O. XXXVII, r. 2(2) either because the defendant has not appeared in answer to the summons for judgment or because leave to appear and defend the suit was not granted to the defendant at all, or, lastly, because the defendant has not complied with the terms of the conditional order of leave. The first of these three cases is covered by O. XXXVII, r. 4, which preserves the jurisdiction of the Court, despite the passing of a decree, to set aside the decree “under special circumstances” and to give leave to the defendant to appear to the summons and to defend the suit on such terms as the Court thinks fit. In the last two of the three cases, the Court which has passed the decree under O. XXXVII, r. 2(2) would become functus officio with the passing of the decree, like any other Court which passes a decree under O. XX of the Code. If the defendant is aggrieved by the decree in any one of the last two cases, his proper remedy is to file an appeal against the decree. Order XXXVII of the Civil Procedure Code is, in a sense, a self-contained Code and with the consciousness of hard decisions, when the Legislature wanted to make provision with regard to the circumstances in which a decree passed under any of the provisions of that Order should be set aside, the Legislature expressed provided by r. 4 that the decree could be set aside in the circumstances mentioned in that rule. If it was intended that a decree which is passed by reason of the default of the defendant to comply with the terms of the conditional order could also be set aside by the Court which passed the decree, the Legislature would have made a suitable provision similar to the one which is found in s. XXXVII, r. 4. It is clear from the absence of any such provision that what was intended was that a Court which passes a decree in a summary suit should have jurisdiction to set aside the decree in cases covered by O. XXXVII, r. 4 only and in no other case. In exercising his inherent jurisdiction under s. 151 the learned Judge has in effect exercised it so as to contravene an implied prohibition and it is settled law that the powers preserved by s. 151 should not be exercised so as to overcome a prohibition enjoined by the Code. The sole function of s. 151 being to preserve the powers to act in the interest of justice, it must follow that s. 151 cannot be invoked so as to enlarge or widen the scope of one's jurisdiction.

7. For these reasons, I am of the opinion that the learned Judge was in error in setting aside the decree which was passed on April 13, 1961. The rule in the revisional application will, therefore, be made absolute, the order passed by the learned Judge will be set aside and the decree passed on April 13, 1961, will be restored. The plaintiff will be at liberty to withdraw the amount which has been deposited by the defendants in the trial Court after a period of six weeks from to-day.

8. The petitioner will get the costs of this petition from the respondents.

9. Order accordingly.